Starting a new business? Get 40% off our accountancy services for 3 months! 😎

x

If an employee wants (or needs) an extended leave of absence, their employer might agree to a sabbatical. We explain what this means for employers, and what to consider.

What is a sabbatical?

A sabbatical is an extended break from work which employees agree with their employer for a set period of time. Employees are still employed by the business during a sabbatical, and will still have a role to return to.

A sabbatical shouldn’t be confused with their holiday entitlement or sick leave, though an employee may wish to use their accrued holiday leave at first.

What is the purpose of a sabbatical?

There’s an entire planet to explore, new ideas to work on, and discoveries to be made. An extended sabbatical enables staff to pursue other interests or to reflect whilst away from the work environment.

Employees are likely to return feeling rested and rejuvenated, and hopefully with plenty to inspire them. And really, the appeal of a sabbatical is the promise of returning to stable employment afterwards; taking an unpaid break from work is a lot less scary if the job is still there to go back to.

It’s not all about supporting employees though. Being approachable on the subject of prolonged personal absences has benefits for employers, too. A member of the team being away for an agreed length of time is probably preferable to losing valuable knowledge and experience from the business altogether.

Do I need to pay staff for sabbatical leave?

Paid sabbatical leave is rare, though as an employer you can offer it at your own discretion. It’s more commonly the case for academics who are taking a break from their usual role to pursue an area of research.
 

Complete managed payroll service

From just £6 per payslip

Learn more

How does sabbatical leave work on payroll?

During a sabbatical an employee is still just that – an employee. Staff taking a prolonged leave of absence should still be included in the payroll and on PAYE submissions, even if their pay is zero for that payroll period. Just remember to change the salary amount, both when they finish to avoid over payments, and when they return to avoid frayed tempers!

Sabbatical leave and PAYE deductions.

Permanent employees usually have their tax deductions worked out on the expectation of working for the full tax year. By taking unpaid leave during the tax year, they might not have to pay as much tax as originally thought. This can mean they’re due a refund on the tax they’ve already paid.

The overpayment can be dealt with either as:

  • A lump-sum refund through the employer
  • A tax code adjustment so that the employee pays slightly less tax the following year, to balance out the overpayment

Overpayments can only be repaid once the tax year has finished though!

If the employee decides not to come back (and yes that’s always a possibility) then obviously refunds can’t be processed through the employer. In that case, the employee will need to request a refund through their Personal Tax Account (PTA).

 
If you have questions about this or other payroll procedures, talk to a member of our team to learn more. Call 020 3355 4047 and get an instant online quote.

About The Author

Elizabeth Hughes

A content writer specialising in business, finance, software, and beyond. I'm a wordsmith with a penchant for puns and making complex subjects accessible. Learn more about Elizabeth.

More posts by this author
Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Read more posts...

Maternity Pay for Self-Employed People

Being self-employed can offer the kind of freedom and flexibility many of us dream about. But if you’re looking to start or…

Read More

What are Payments on Account?

Payments on account are a type of advance payment that you might need to make towards your Self Assessment tax bill. In…

Read More

Staff Spotlight: Aaron Parkinson, Semi-Senior Accountant

This month we spoke to Aaron Parkinson, Semi-Senior Accountant at The Accountancy Partnership! Give an overview of the duties, functions and responsibilities…

Read More
Back to Blog...

Confirm Transactions

The number of monthly transactions you have entered based on your turnover seem high. A transaction is one bookkeeping entry such as a sale, purchase, payment or receipt. Are you sure this is correct?

Yes, submit my quote
No, let me change it

Please contact our sales team if you’re unsure

VAT Returns

It is unlikely you will need this service, unless you are voluntarily registered for VAT.

Are you sure this is correct?

Yes, the business is VAT registered
No, let me change it

Call us on 020 3355 4047 if you’re not sure.

Bookkeeping

You will receive our bookkeeping software Pandle for free, as part of your package.

You can use this to complete your own bookkeeping, or we can provide a quote to complete your bookkeeping for you.

Please select and option below:

I will do my own bookkeeping
I want you to do my bookkeeping

Call us on 020 3355 4047 if you’re not sure.